Zhang Yan, fund manager of ABC Huili: layout hard technology, focus on soft applications

Anon

After experiencing systematic adjustments after the Spring Festival, since May, hard science and technology based on new energy, military industry, and semiconductors has performed well.

In August, boosted by the production restriction policy, cyclical stocks rose rapidly, the hard technology sector that performed well in the early stage was adjusted again, new energy has been consolidating at a high level due to sales continuing to exceed expectations, semiconductors have been greatly adjusted due to weak downstream demand such as mobile phones, and the military industry has also shown a large drawdown. But in the medium to long term, we continue to be bullish on hard technology.

Demand for new energy vehicles continues to improve. With the release of domestic and foreign production and sales data in September, Europe is expected to exceed 2 million vehicles in the whole year and 600,000 to 700,000 vehicles in the United States. Domestic new energy vehicle sales also increased significantly year-on-year.

The new energy sector has risen high in the past two years, the market is worried about the high valuation, but the medium and long-term logic is still recognized, the valuation of most of the stocks in the current sector is still in a relatively reasonable range, even if there are individual companies that are relatively high, the continuous demand of downstream demand will bring performance beyond expectations, thereby digesting high valuations.

The military industry sector is expected to be driven by themes to performance. The relevant national strategic planning has also been emphasizing the application of innovative warfare and new technologies to modernize the military from all dimensions.

The semi-annual report of listed companies has cashed in high growth, the high prosperity of orders has continued, and the contract liabilities of OEMs have also increased significantly, and the future is stable and high growth is worry-free. After the report, it temporarily entered the vacuum period at the information level, superimposed on the so-called "collection" in the early stage to suppress emotions, and there was a sharp decline. After the results of the third quarter are clear, it is expected to dispel market doubts.

The logic of domestic substitution of semiconductors has been continuously strengthened. In the long run, strengthening the domestic substitution logic of the semiconductor industry and continuing to promote the innovation and development of the domestic semiconductor industry will continue. The demand for semiconductor downstream mobile phones, tablets, etc. is weak, and we focus on the layout of equipment and material companies that benefit from domestic substitution, and the downstream power semiconductor industry that is highly related to new energy vehicles and photovoltaics.

We also keep a close eye on 5G applications, new consumption, etc. Since the commercialization of 5G, the penetration rate of domestic 5G mobile phones has reached 40%, and there have been no explosive applications, which is worth paying attention to. In the early stage, due to the impact of anti-monopoly, collection, real estate, and repeated special periods, the consumer sector fell deeply, but some new consumer companies still maintained rapid growth with the rise of new channels, and could be laid out at a low price.